Maurice D. and Elinor Taylor - Page 29

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             of 1989 (OBRA), Pub. L. 101-239, sec. 7721(a), 103 Stat. 2106,                                       
                    Petitioners assert that they are not liable for the addition                                  
             to tax and accuracy-related penalties for negligence or disregard                                    
             of rules or regulations, or substantial understatement of tax,                                       
             because of their state of upheaval during the investigation and                                      
             prosecution of petitioner for his check-kiting activity.                                             
                    With respect to 1988, the reasonable cause exception does not                                 
             apply.  OBRA sec. 7721(a).  Thus for 1988, petitioners are liable                                    
             for the addition to tax for negligence pursuant to section                                           
             6653(a)(1) and the addition to tax for substantial understatement                                    
             of tax pursuant to section 6661(a).  Petitioners presented no                                        
             evidence with respect to the failure to timely file their 1988                                       
             Federal tax return, and thus they are liable for the addition to                                     
             tax pursuant to section 6651(a)(1).  Rule 142(a).                                                    
                    With respect to 1988, 1989, and 1990, petitioners made an                                     
             inadequate effort to determine their proper tax liability.                                           
             Although their business records were generally in disarray,                                          
             petitioners had some grocery/convenience store records that could                                    
             have been presented to their accountant, Mr. Mules, or to Revenue                                    
             Officer Scilipoti, including the box of bills and the calendar                                       
             reflecting daily gross receipts.  These records were presented to                                    
             petitioners' attorney and to the IRS in the course of the IRS's                                      
             audit.  Petitioner's preoccupation with his criminal problems does                                   

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